HEY KIDZ SUE THEIR ASSES OFF

Shell CEO Ben Van Beurden: Carbon emissions court ruling was ‘body blow’

Simon Freeman
Thu, January 20, 2022

(Benoit Tessier/Reuters)

ROYAL DUTCH SHELL’s CEO Ben van Beurden today described a court ruling from The Hague ordering faster, deeper cuts to the company’s carbon emissions as a "body blow".

In comments likely to provoke controversy among green activists, he said: “I was listening at home as the judge gave her verdict. It felt like a body blow.

"I found it deeply troubling that Shell as a single business should be held accountable for how the world produces and uses energy."


Shell last year pledged to cut greenhouse gas emissions from its operations by a fifth by 2030, reaching a net-zero target by 2050 in line with the Paris 1.5C climate change agreement.

(AFP via Getty Images)

But in May, the Dutch court ordered it to step up the pace, and get total emissions - including the 90% produced downstream by motorists and businesses which use its fuel - down by 45% on 2019 levels.

In October, Shell responded by raising the target to a 50% cut by 2030 within its own operations, but the company believes it was unfairly “singled out” and is appealing against the landmark judgement.

In a wide-ranging interview posted on the company’s corporate website today, van Beurden said: "[The ruling] goes against everything I believe in when it comes to climate change, namely that this is a societal problem, not a problem for a single company to solve.

"It’s also worrying that the ruling was met with so much approval in some places, as if this was indeed the solution society needed."

Van Beurden has become a lightning rod for criticism from campaigners who complain the energy industry is dragging its feet in the transition to a low-carbon economy.

Shell is ploughing billions into hydrogen and other alternative energy sources but has said cutting oil and gas production before these new green businesses are generating cash would lead it into a “valley of death”.

Van Beurden said: “When people attack Shell for not going fast enough that feels deeply personal. But I have no choice but to deal with the criticism. I cannot walk away from it or hide under my desk.”

Friends of the Earth’s Netherlands chapter Milieudefensie, which led the legal action, has said it has no "immediate plans" to bring a fresh case in the UK, but "continues to explore options against multinational corporations."

(PA Wire)

The 63-year-old, who has spent almost four decades at Shell, also accused governments of fueling the price volatility which has sent energy bills soaring across Europe by "unnecessarily" reducing domestic production while demand remains high.

He said: "It will take intelligent policies and intelligent application of these policies to get it right. “

Shell is Europe’s biggest oil and gas group, producing the equivalent of more than three million barrels of oil a day.

Van Beurden said: "Some governments in north-west Europe have reduced domestic production of natural gas significantly, but demand remains high.

“That cannot be fixed in the short term by increasing domestic production because it is impossible to ramp back up quickly.

(PA)

“It will probably take imports of natural gas, and the higher prices needed to attract those imports, to fill the gaps in supply."

He added: "Governments also need to learn from this moment and tackle the demand for hydrocarbons as much as they have so far wanted to tackle the supply of hydrocarbons.

“Today, motorists still need fuel for their cars, and many homeowners need natural gas for cooking and heating.

"Even if Shell stopped supplying these products, people would still need them, and they would buy them from other companies."

(PA Wire)

Van Beurden went on to describe a decision to abandon Shell’s long-standing Anglo-Dutch dual listing status and move its HQ and tax base to London as: "a very sad moment."

He said the corporate structure was a "real handicap" on its ability to "move fast and do new things", including handing most of the $9.5billion proceeds from the sale of oil assets in the Permian Basin in Texas back to shareholders through buybacks.

It is now the biggest company on the FTSE 100, with a market valuation of around £140 billion.

He said: I had personally worked on finding a solution with the Dutch government for all my eight years as CEO. Still there was no solution in sight, other than the solution to move the headquarters to the UK.

"It was a very sad moment when I made the decision to put the simplification to shareholders and the board.

"When I joined Shell 38 years ago as an engineer, I thought it was the most iconic company in the Netherlands and even in Europe.

“I could never have imagined being CEO, let alone taking the company’s headquarters out of the Netherlands. But I felt there was no choice because of the need to move faster in the energy transition."

The company benefitted from soaring gas prices leading to bumper trading profits in the fourth quarter and will deliver its financial results on February 3.